The value of the Naira is depreciating at an alarming rate with the currency exchanging for N670 per dollar on Tuesday at the parallel market.
Observers argue that the Nigerian currency entered its sick state last Tuesday after the Governor of the Central Bank of Nigeria (CBN), Mr Godwin Emefiele, announced that decisive action would be taken against any person caught withdrawing Naira with the sole aim of buying the Dollar.
This sent a wrong signal to the foreign exchange (forex) market and despite an effort made the next day by the apex bank to clarify that the threat was directed at politicians, the Naira has now stopped the free-fall, which is majorly the fault of FX hoarding.
At the black market on Tuesday, the local currency was exchanged with the greenback at N670/$1 compared with the previous day’s exchange rate of N665/$1, indicating that it has lost N5 or 0.75 per cent in less than 24 hours.
This rate applies to FX users in need of the Dollar for transactions, ostensibly outside the country.
However, for those who have the US currency in their possession but want the Naira, the exchange rate in the parallel market as of the time of filing this report was N663/$1, according to forex sellers on the streets of Lagos, who chatted with this reporter.
On the peer-to-peer (P2P) segment of the FX market, the Naira was exchanged with the American currency on average at N682/$1 as of the time of this report.
